If you live in a state that has legalized mobile sports betting, chances are that unless you have been living under a rock you have seen a sports betting ad.
The ads are repetitive and feel overwhelming. They talk about “risk-free” bets and signup offers where if a player scores a point in a basketball game and you bet $1, you get $300 in free bets.
After the deluge of ads, it is easy to become numb. If it is too good to be true, then chances are it usually is. However, there is some truth to the ads. The signup offers are legitimate, and the sportsbooks hope to make money off of you over time.
And on average, most sports bettors lose money. But after running my own simulations, I have determined how betting $300 per month has roughly the same monthly cost as Netflix.
With New Jersey’s monumental legalization, we see more and more states legalize US sports betting sites, so this is the perfect time to evaluate how a person should approach betting.
What Are My Chances of Going Broke?
Key Findings of the Simulations
- Only 13.4% of bettors lost $99.55 or more
- 61.1% of bettors netted between $43.64 and $-42.27
- 40.6% of bettors were profitable
When New Jersey online sports betting went live in 2018, it caused a ripple effect of legalization across the country that now gave people the opportunity to legally bet on sports, which is why it may be good for us to understand our win-loss potential.
Theoretically if you make $300 in bets, you could lose $300. However, if you spread out your $300 into multiple bets, you can decrease your chances of losing $300.
That is why I decided to put together and run 25,000 simulations on what would happen if someone randomly made twenty $15 spread bets in a month for a total of $300 in bets.
The Process & Results of the Simulations
Without getting into anything too nerdy, my simulations which were run in Excel are simple.
Each cell had a 50% chance of being a winning bet, and a 50% chance of being a losing bet. A winning bet would have a net profit of $13.64, while a losing bet would have a net loss of $15.
After running 25,000 simulations of a bettor making twenty spread bets, none of my bettors won or lost all their bets.
And actually, 88.5% of my simulations resulted in bettors netting between $72.27 and -$99.55 in profits after a month’s worth of bets. The median bettor lost only $13.64, and 40.6% of simulations resulted in a profit.
While it is possible to win at US sports betting sites long-term and to beat the odds (no pun intended), winning at sports betting requires more skill than randomly picking teams. In fact, it is believed that only 3% of sports bettors are long-term winners.
But even if you randomly pick teams and bet responsibly, the cost is relatively low for the entertainment value of merely yelling at a television screen and rooting for your bet.
Many would agree that betting $100 on the Bucks to cover the spread against the Suns is more entertaining than a game of laser tag, and the expected loss of $4.55 from that bet actually comes in at a lower cost than the average $9 game of laser tag.
What If I Used Different Unit Sizes?
Key Findings of the $30 Units Simulation
- 17.1% of bettors lost $128.18 or more
- 65.8% of bettors netted between $43.64 and $-70.91
- 37.8% of bettors were profitable
- 17.1% of Bettors won $100.91 or more
For my original simulation of a bettor making twenty $15 bets, which you can do with ease on sports betting apps, that bettor made more than $100 in only 5.7% of my simulations.
As a result of those findings, I wanted to try out a simulation where a bettor randomly making picks on a $300 monthly budget could have a better chance of making more than $100 in a month.
Therefore, I made a simulation where a bettor could make only ten bets per month of $30 each.
In 17.1% of my simulations, that bettor made more than $100. However, in 17.1% of my simulations, that same bettor lost $128.18 or more.
Intuitively, it makes sense that with increased risk, the potential for making more money increases, while on the flip side, the potential for losing more money goes up as well.
Key Findings of the $10 Units Simulation
- Only 4.81% of bettors lost more than $100
- 93% of bettors netted between $81.82 and -$90
- 42.6% of bettors were profitable
For my scenario where a bettor places twenty $15 bets, that bettor lost $99.55 or more in 13.4% of my simulations.
While that bettor in my opinion had a low risk of losing around $100 or more, I wanted to see if it were possible to lessen the risk of a loss that large.
That is why I decided to run 25,000 simulations on a bettor who makes thirty $10 bets and what percentage of the time do they lose around $100 or more.
The result of my new simulations was that the bettor who makes thirty $10 bets, only lost more than $100 in 4.84% of my simulations.
The downside of making thirty small wagers instead of twenty, is that in only 2.2% of my simulations did that bettor make more than $100.
How To Offset the Minimal Costs of Sports Betting?
With the boom of legalized sports betting in the US, now is the best time for current sports bettors and prospective sports bettors to learn how to bet and find the best betting apps for NFL, NBA, MLB, and more.
The good news is, most states with legalized mobile betting have several apps available and each of these apps are competing for customers. In fact, with one of the most populated states in the country ready to launch online sports betting in New York, you can expect this to help out the sports bettor tremendously.
To compete for new customers, sportsbooks offer signup bonuses, free bets, risk-free bets, and a patheoria of promotions like odds boosts and parlay insurance.
When taking advantage of these offers, the bettor in my simulations who bets $300 on multiple spread bets per month can reduce their expected loss of $13.64 to potentially a profit.
This tells us that it is important for bettors to shop around at different sportsbooks for the best lines, bonuses, and promotions.
How Costly Is Sports Betting?
Whether you are online sports betting in Michigan, Pennsylvania, West Virginia, or elsewhere, the general rule in gambling is that you should only bet what you can afford to lose. That is why it might seem daunting to bet $300 a month on sports, as that amount can buy a round trip plane ticket, a Playstation 4, a GoPro Hero8, and more.
However, using point spreads as an example, you should expect to lose only $13.64 if you bet $300.
Spreads typically pay $10 for every $11 that you bet, and they are designed so that half of the time you win and the other half of the time you lose. Even a blind bat could pick teams against the spread and win occasionally.
With an expected loss of only $13.64 when betting $300 on sports per month, the cost of sports betting is nearly identical to a Netflix Standard monthly membership which costs $13.99 a month.
By taking advantage of promotions and sportsbook bonuses at the right times, you could even potentially improve upon that number.
Additionally, as a hobby, sports betting is less expensive than Tinder Plus, MLB.TV, NBA League Pass, a gym membership, and playing laser tag once per week.
It is also not that much more expensive than Amazon Prime, Peloton monthly membership, and Hulu without ads.
There is no such thing as a free lunch, every entertainment activity is going to cost you some amount of money. Even a library membership, which is free, is costly through either your tax dollars and/or late fees if you return your books late.
As long as you play within your means, sports betting can be a reasonable and enjoyable experience for both sports fans and betting enthusiasts alike.